Denver cab companies profits down as revenue rises

SUBSCRIBER CONTENT: Jul 13, 2012, 4:00am MDT

Denver cab companies profits down as revenue rises

Enlarge Kathleen Lavine | Denver Business Journal Bill Fawcett is general manager of Union Taxi, which began operations in Denver in 2009.

L. Wayne Hicks Social Media Engagement Officer / Digital Producer- Denver Business Journal Denvers taxi industry hit a rough patch last year, with two of the major cab companies reporting a drop in profits and a thirds profits off by more than $700,000 from two years earlier. But none of the three Yellow Cab, Freedom Cabs and Union Taxi Cooperative lost money, and their combined revenue has risen by more than 18 percent since 2009, according to annual financial reports filed with the Colorado Public Utilities Commission. Denvers fourth cab company, Metro Taxi, filed a confidential annual report for 2011 with the PUC, which regulates the industry. Terry Bote, spokesman for the PUC, said Metro isnt required to file a report for public view. Taxi companies routinely file annual reports, but some mark theirs as confidential.

Denver cab companies profits down as revenue rises

The PUC has licensed just four taxi companies to operate in metro Denver; they have authorization for a combined 1,262 taxis. Metro is the largest, with PUC approval to have 492 cars on the road. According to financial reports since 2009, which is when Union Taxi became the newest cab company to receive PUC approval: Yellow Cab made $737,626 in profit during 2009, lost $578,525 the next year and eked out a profit of $16,517 in 2011. Freedom turned a profit in each of the three years, but after reaching $131,410 in 2010, its profits dipped to $107,719 last year. Union, which lost $73,508 in 2009, posted a profit of $255,078 in 2010, but that number fell to $93,824 last year. Metro made $218,269 in 2009, but lost $532,929 in 2010. Requests for an interview with the operators of Metro went unanswered. Yellow Cab and Freedom also didnt respond to requests for an interview. The three companies that filed public annual reports posted combined revenue of $20.8 million last year, an 18.67 percent increase from two years earlier. Yellow Cab accounted for the largest portion of that combined revenue, with $11.46 million. Comparable data for the four companies reveal a 5.6 percent revenue increase between 2009 and 2010, to a total of $30 million. Metro Taxi brought in $12.2 million of that. Yellow Cab was the only company to reveal how much it spent on fuel last year. Yellow Cab spent $228,038 on fuel, up from $32,555 in 2009. Although the three taxi companies racked up 259,676 trips to Denver International Airport last year, airport runs amounted to only 12.5 percent of all cab rides around metro Denver. Bill Fawcett, general manager of Union Taxi, said the industry relies more on passengers taking short trips, particularly residents of Denvers urban areas. That group tends to use cabs more and tends to have automobiles less, Fawcett said, so its trips in and out of downtown and around downtown thats probably the core of the business.

Denver cab companies profits down as revenue rises

But because a ride to DIA covers more miles than a trip to the store, airport runs generate more revenue. Union Taxi took in $1 million from general passenger service last year and $3.38 million from DIA passengers. More from the financial reports: Freedom Cabs rebounded last year from a drop in the number of airport trips during 2010. After 90,522 trips in 2009, the number fell to 81,042 the next year before climbing to 116,920 in 2011. Non-DIA trips showed a steady increase, rising to 75,555 last year from 64,095 in 2010 and 45,004 in 2009. Yellow Cab, which relies on independent contractors to drive its taxis, has increased the number of drivers. The company, which had 480 drivers in 2009, had 588 last year. Union Taxi has made inroads into the taxi market since starting out in 2009. Trips to the airport dipped to 51,775 in 2010 before reaching 61,876 last year. Trips to other destinations increased to 450,923 in 2011 from 140,800 two years earlier. Union Taxi late last year launched an associate driver program intended to get more cabs on the road. A driver can work 16 hours a day but no longer than 80 hours over eight days. Fawcett said bringing in associate drivers allows the company to run cabs that otherwise wouldnt be in use. L. Wayne Hicks is Social Media Engagement Officer / Digital Producer of the Denver Business Journal, writes for the "Cultural Attache" blog, and compiles the daily "Morning Edition" email. Phone: 303-803-9221.